December 28, 2022

A Guide on Automating KYC Process!

Learn how VisionERA can automate the process of KYC (know your customer) in organizations.

KYC or Know-your-customer or client is an essential process in every organization. However with changing times, the requirements of the process have also changed. Today with thousands of requests per day, companies require infrastructure that can cater to their needs. It is because of this reason multiple companies have started to move towards KYC automation.

What is KYC Automation?

KYC automation is the process of automating KYC requests and the processes related to it. It means creating an architecture or ecosystem that would help companies process KYC requests faster. 

Ideally, the work of KYC automation is performed by the combination of two solutions i.e an automated data extraction platform and RPA (robotic process automation). 

With this article, we will guide you through the process of automating KYCs using VisionERA IDP (Intelligent Document Processing). VisionERA is a platform that is built on AI-engines to process thousands of requests for document extraction and verification.

Therefore to learn more about the KYC process and how it can be automated using VisionERA IDP…read ahead!

Reasons behind KYC Process and its Automation

Initially the KYC process started because of money laundering activities. In the U.S, the KYC started in 1970 under the AML (anti-money law) regulation. However after 9/11, it was included as a patriot act. It is because after the horrifying incident it became important for organizations to understand where their customers come from. The reason was to prevent financial activities that can aid terrorism. In fact, there are many countries who mandate KYC and after a particular period of time if the requirements are not met by the customer, their services are halted until details for KYC are provided. 

KYC is an industry-wide process. It just doesn’t exist in banking but today the majority of industries do KYC for their customers. It is used in banking, trading, blockchain, payments, telecoms, fund management, etc. However, with a mandatory requirement, the work related to KYC has also increased.

This led to following challenges:

  • High Operational Cost: With the increase in the number of KYC fulfillment, the document processing work related to it also increased. It required a separate department fulfilling requirements for tons of unstructured paperwork for data extraction and verification purposes. This required organizations to allot a lot more cost for process, time, and company resources.
  • Lower Efficiency: With the requirement of processing huge volumes of requests, the challenge of onboarding new customers became a challenge. Since the process was primarily catered via manual procedures, the number of requirements fulfilled were also less.
  • Human Induced Errors: Processing of documents for data extraction and verification can be monotonous. It often leads to errors in terms of spelling mistakes, incorrect data, duplicate data, etc. Each of these errors are more expensive to resolve later than the time the request was fulfilled.

With KYC automation, companies can automate all the repetitive tasks involved with the process. It would mean lower operational cost, smaller team to handle document processing, higher efficiency in terms of throughput, zero human induced errors, and a lot more.

A KYC automation solution can even connect with a cloud-based storage service such as AWS. It would allow organizations to store their KYC data securely and with the capability of remote access. KYC automation will accelerate the speed of the number of KYC request teams can handle. It would mean faster customer onboarding and higher customer satisfaction.

Traditional Steps of KYC Process

Traditionally, the steps required for KYC can be divided into two parts i.e. Aggregation of Data and Validation of Data from third-party sources. Once these two steps are fulfilled, the KYC process for a client or a customer is completed.

Step 1: Aggregation of Data

In this step, the organizations gather information about the customer. It includes asking them a list of questions and demanding other essential information.

This information can include:

  • Names of company directors
  • Business Address
  • Social Security Number

Step 2: Verification of Data

The process of verifying the data is done on two levels.

Initially the data submitted by the client and the customers would be verified using open-source databases from publicly available data. It includes details such as names, address, registration number, etc.

The second level requires the data to be verified via government and law enforcement agencies. This is done for following reasons:

  • Identify individuals for suspected criminal activities.
  • Intelligence for partaking in bribes or money laundering.
  • Identify politically exposed personnels.

Automation of KYC Process via VisionERA

With VisionERA IDP (Intelligent Document Processing) companies would be able to automate their KYC process end-to-end.

VisionERA platform can provide a twofold solution for KYC processes in organizations i.e.

Step 1:

In this step, VisionERA will aggregate all the data submitted by the client or customer. This data will be collected from documents provided by the clients and consolidated into spreadsheets or any downstream application for future usage.

To achieve that the user is required to create a custom workflow for KYC automation. It would include all the necessary details that are to be aggregated from the documents submitted. Once the workflow is set up, VisionERA would work automatically providing all the necessary information.

Step 2:

During the time of data extraction from documents, VisionERA can verify the data provided by the client using the Government IDs provided by them. VisionERA can also connect with third-party sources such as government databases and verify data from there.

Note: VisionERA can be implemented in your organization at $0 invoicing.

There is a lot that VisionERA can do for organizations. If you are interested in learning more about our platform in detail, set up a demo with our team by clicking here. To use VisionERA by yourself, use our trial version.

Get Started with your Document Automation Journey

$0 Implementation cost | $0 monthly payments -> No Risk, No Headaches

Pay only for Satisfactory Results!

Sign up for Free Trial